In February 2014, the Tennessee State Board of Education (SBE) requested that the Appalachia Regional Comprehensive Center (ARCC) provide assistance to the SBE's Basic Education Program (BEP) Review Committee. The SBE requested additional information on the use and effectiveness of market-based teacher compensation and market-based incentives by districts and states to recruit science, technology, engineering, and mathematics teachers. The SBE is interested in using this information to encourage school districts to align teacher salaries with the salaries offered by competing employers to improve teacher recruitment and retention in Tennessee, particularly in areas of shortage. In response to the request for information from the SBE, ARCC consulted with the Center on Great Teachers and Leaders (GTL Center), one of the seven content centers in the Comprehensive Center network, to supply research and provide feedback on a review of the report. Identifying a lack of evidence about the impact and costs of such initiatives, GTL Center staff also conducted informal interviews with leaders of emerging market-based compensation initiatives to seek additional, unpublished information. The report includes (1) background information on the BEP Review Committee and the history of teacher compensation reforms in Tennessee, (2) a summary of the literature and evidence on the effectiveness of market pay, and (3) examples of emerging practices, challenges, and lessons learned to support the committee's decision-making. The following is appended: Glossary of Terms.